The Prosperity Blog

Safe Haven Assets for your Dollars

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Where can you keep your money where it will be safe!? That’s what many investors are asking themselves right now. They are looking for safe haven assets and weighing their choices. Today we will review options such as T-bills, bonds, gold, bank products, and our favorite safe haven asset!

But first, let’s be clear about what is NOT a safe haven asset:

It’s not a more “conservative” stock portfolio. The S&P 500 is down a whopping 22% in one month, but we’ve seen losses in virtually every sector. Industries that usually provide stability or profits during times of volatility and recession are only faring a bit better:

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Saving and Investing in a Volatile Market

“People should be more concerned with the return OF their principal than the return ON their principal.” (Often attributed to Will Rogers, probably mistakenly.)
Saving and Investing in a Volatile Market

Investing in a volatile stock market presents some big challenges—as many have recently learned! The last couple of weeks, we have seen tremendous uncertainty and volatility on Wall Street. This included the fastest 10%+ drop in the history of the stock market… followed by a “circuit breaking” dive this morning.

Tech stocks have been hard hit. Travel industry stocks have plummeted. Retail and restaurants fell as well. Nearly all stocks lost value. The price of gold rose, then gold mining stocks crashed. The price of oil fell, and financial stocks crashed along with it. We’ve seen rallies in between the valleys, but virtually every corner of the stock market has suffered losses.

What now!?

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5 Steps to Prepare for an Emergency

“You might be a prepper if your homeschooled 7-year old knows Morse code, your dog has a bug-out bag, and your basement is filled with toilet paper, ammo and bic lighters (and you don’t smoke).”

—The Internet

This week, the spread of the novel coronavirus, aka COVID-19, and the corresponding 9-percent-in-a-week drop of the stock market are in the headlines. Today, we focus on how to prepare for a potential emergency situation or disruption of “life as usual.” In a few days, we’ll cover safe havens for saving and investing. (If you are practicing Prosperity Economics, you might have “weatherproof” strategies already in place to keep your money working—even during a black swan event!)

In case you’ve been hiding under a rock, let’s quickly review the situation. According to the compiled official data synthesized at Worldometers.info, over 82,000 people in 50 countries are now reported to be affected by Covid-19. Tens of millions have been quarantined and the loss of life, especially in China, is sobering.

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Cash on Demand: The Power of Liquidity!

“Success is where preparation and opportunity meet.”
– Bobby Unser, Indianapolis 500 Champion

liquidity definition financeOnce upon a time. we saved in coffee cans and mattresses. Money was liquid and readily available! Then, we saved in bank accounts and CDs. Now, with the popularity of 401(k)s and IRAs, it has become normal to lock up your dollars for decades.

The goal of Wall Street (with help from its Congressional accomplices) is to keep control of your dollars… for as long as possible. Never mind “cash on demand.” Popular financial advice tells you to accumulate money in accounts you have little access to. Then just cross your fingers and hope it is there for you when you need it!

There are clearly upsides to growing investments without interruption. Withdrawals slow growth, plus there is an opportunity cost. But what are the downsides?

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10 Ways to Money-Proof Your Relationship

money and relationshipsAs we approach Valentine’s Day, millions of Americans will celebrate with special dinners, cards, flowers, chocolates, and “I love you’s.” Whether you’re a fan of Hallmark Holidays or not (I’m not), hopefully, we can all celebrate love, partnership, marriage, and companionship! And now is a good time to examine the money and relationships — and how to improve both!

Unfortunately, many couples won’t be celebrating their relationship this week because it was torn apart by conflicts over money. “Money fights predict divorce rates,” says the New York Times. 80 percent of couples fight about money, says a 2014 Money Magazine survey. Research from American Express revealed that 91 percent of couples avoid talking about finances, and only 43 percent discussed money before marriage!

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Bye-bye Stretch IRA: Uncle Sam Wants his Cut!

How the SECURE Act Impacts Inherited IRAs

How the SECURE Act Impacts Inherited IRAs Last week, we published an article summarizing many of the changes the SECURE Act brings to retirement plans. These include new rules regarding retirement plan contributions, distributions, the availability of annuities within plans, maximum contributions for automatic enrollment plans, employer incentives to participate, and more.

This week, we focus on one remaining change—and perhaps biggest challenge—of the SECURE Act: the new rules around inherited IRAs. The stretch IRA strategy is dead and it’s time to seek alternatives. If you believe you may inherit an IRA or leave one to beneficiaries, this is information you need now—before it’s too late to stop Uncle Sam from taking a big chunk of your intended inheritance!

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The SECURE Act Changes the Rules of Retirement Plans

How the SECURE Act Changes the Rules of Retirement PlansAt the end of 2019, Congress passed the biggest bill affecting retirement accounts in more than a decade. (You may have been unaware of it since the news cycle has been filled with the impeachment drama!) Today, we summarize the SECURE Act changes that may impact you in 2020 and beyond. Next week, we’ll have a follow-up article on the impact the SECURE Act will have on inherited IRAs.

The awkward acronym “SECURE” stands for Setting Every Community Up for Retirement Enhancement Act. Signed into law by President Trump before Christmas, the legislation is intended to help Americans increase their retirement savings. Let’s look at how it actually may accomplish that goal—as well as the challenges it brings.

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